The Wonder Drug Company's total overhead costs at various levels of activity are presented below:
month; direct labor hours; total overhead
september; ;
october; ;
november; ;
december; ;
Assume that the overhead costs above consist of indirect labor, scheduling salaries, and maintenance. The breakdown of these costs for the month of November is as follows:
Indirect labor V
Maintenance M
Scheduling Salaries F
Total Overhead
Required:
a Using the highlow method, determine the cost formula for maintenance.
b Express the company's total overhead costs in linear equation form.
